The parade of catastrophic accounting scandals, chief among them the Enron debacle, has intrigued business and the general public as few corporate scandals ever have. Hidden Financial Risk: Understanding Off-Balance Sheet Accounting thoroughly and accessibly explains the dubious methods by which firms hide debt and the failings by managers, directors, auditors, regulators and investors who allowed these methods to poison financial reporting. Besides placing particular emphasis on understanding Special Purpose Entities, Enron's preferred method of deception, this book also:
Identifies the incentives for managers to deceive investors and creditors about the firm's financial risk
Illustrates the equity method, lease accounting, and pension accounting, popular methods of Off-Balance Sheet accounting, and explains how investors can deconstruct them
Examines the failure of boards of directors, accountants, the FASB and the SEC to minimize accounting failures
Discusses what must be done to reduce the number of corporate managers who lie in financial reports
Shows what individual investors must do to protect their investments in a world filled with accounting and auditing fraud
Explains how the Sarbanes-Oxley bill will affect financial reporting
Hidden Financial Risk: Understanding Off-Balance Sheet Accounting supplies a compelling diagnosis, prescription, and vision of its road to recovery of financial reporting's critical condition.
Hardcover, 298 pages
John Wiley & Sons Publishing
Table of Contents:
Chapter 1: What? Another Accounting Scandal?
Chapter 2: Balance Sheet Woes
Chapter 3: How to Hide Debt with the Equity Method
Chapter 4: How to Hide Debt with Lease Accounting
Chapter 5: How to Hide Debt with Pension Accounting
Chapter 6: How to Hide Debt with Special Purpose Entities
Chapter 7: The Failure of Managers and Directors
Chapter 8: The Failure of the Auditing Profession
Chapter 9: The Failure of Regulation
Chapter 10: The Failure of Investors
Chapter 11: Andersen Has the Solution—Really!